The ACA isn't supposed to help healthy and financially secure people like your lawyer friend. It is supposed to help sick and financially insecure people, by forcing healthy people (who are in the majority) to subsidize the cost of their care (which is very expensive).
There's a moral question at the heart of this, the answer to which defines the solution space: do we, as a society, think it is important that all sick people receive care? If yes, there are a bunch of potential solutions, but they all involve healthy people subsidizing care for sick people. If no, there are, of course, a lot more options.
The thing that frustrates me about the current Republican approach is that they seem to want to answer "yes" to this question, while telling voters they will not have to subsidize care for the sick in any way.
Depending on your point of view, either the best feature, or the biggest failure, of the ACA was that it made this subsidy for the sick visible to anybody buying their own insurance, rather than hiding it behind taxes or complicated dynamics between governments, insurers, employers, and hospitals.
A little more succinctly: either we decide to let emergency rooms turn sick people away, or somebody will be paying for their care. There's no magical solution.
I think you've answered a question you'd like to answer instead of one you don't: WHY is healthcare in this country SO EXPENSIVE?
The way to make care available is to drive down costs. We haven't done a single thing with the ACA to improve the affordability of care, we've just made the un-affordability a problem borne by the people who were already doing a good job of taking care of themselves. That's not a scalable solution.
The ACA got us a lot of short-term benefit for a small group of people but set in motion a chain of events that will only drive UP costs while driving affordability down.
And I'd like to argue that until we do something to improve the market dynamics of healthcare we are very likely to see this sort of thing continue to get worse until it's so unsustainable that it's like trying to legislate away the force of gravity.
One thing I'd like to see in any future version of ACA reform is RIGOROUS price transparency by healthcare providers. It should be absolutely illegal for any healthcare provider to conceal, obfuscate, or otherwise obstruct the price discovery mechanism of the market.
Even if you argue that consumers aren't the best people to decide what services are necessary or needed, they can rely on the advice of trusted advisors and popular understanding to shop for healthcare at providers known for offering good value.
SO MUCH of health care isn't of the "emergent" kind but the kind that is for chronic issues that are the result of unhealthy living or plain bad genetic luck. We need to redouble our efforts to drive those costs of care down and start paying for results and not treatment. Paying for treatment encourages overconsumption. Paying for outcomes encourages optimizing for cures.
Well said. Can we also work on the supply of medical care? We keep giving more and more people insurance which increases demand without doing anything to increase supply and then wonder why prices go up.
Your second paragraph is not even close to true - if you do more research on the ACA you'll find that it does all kinds of things to try and improve the affordability of care, a lot of which has made real improvements. Incentives against fee-for-service, quality-of-care rules, medicare/medicaid rules, there's just a ton of that stuff in the ACA. The stuff in your last paragraph is directly addressed by many parts of the ACA. And, more can definitely be done, including price transparency etc. These things tend to be supported by Democrats and opposed by Republicans.
I think you should post some links to relevant sections of the ACA and show me where they take specific actions to drive down costs.
I will tell you that I've seen scant evidence that it's working.
A wishlist of initiatives isn't a plan for action that drives down costs. Allowing Medicare to NEGOTIATE prices for drugs is a plan to drive down costs.
The insurance companies wanted to GROW the per-capita spend on healthcare. That benefited them. It's really really unclear if it benefited the public right now.
Forcing people into a market they don't want to be in isn't reform. The way to solve this problem is to make being a part of the market ATTRACTIVE.
IMHO we really missed an opportunity to affect behaviors. For one thing, Romneycare incentivized people to skip insurance until they needed it. That was a recipe for adverse selection.
The way to help this is to provide incentives for people to get in WAY EARLY and pay for their OWN care long before they may need it while also providing a measurable benefit to those who get in early right away.
People are capable of responding to incentives and I'm convinced that there exists a Nash equilibrium in healthcare that helps everybody win.
Remember, the same people who gave you "the Internet is not a truck" are the same people you're expecting to solve healthcare affordability. Think about that.
You see the lack of honesty on both sides of the aisle. You're right in that Republicans don't just come out and admit that they believe that healthcare is not a right and that people should have to deal with their own health issues.
Democrats don't just come out and admit that they want a wealth redistribution program that they can use to show voters how compassionate they are with other people's money.
They're politicians. They just aren't honest and voters aren't perceptive or concerned enough to call them on it.
> Democrats don't just come out and admit that they want a wealth redistribution program that they can use to show voters how compassionate they are with other people's money.
I want a wealth distribution program that means that thanks to a genetic condition I had no role in acquiring (if you're "doing a good job taking care of yourself" and never get cancer or some other nasty expensive disease, why don't you count your fucking blessings that you're healthy instead of bitching about having to subsidize others) means that I don't get a death sentence if I ever am sick enough to lose my job for long enough to lose coverage and get fucked over in the future on preexisting condition exclusions. Or fucked over due to lifetime benefit caps.
And I want one that protects other people in similar situations too.
So maybe not everyone's motivations are as cynical as you make them out to be.
You might want a redistribution program, just like I don't want healthcare to be a right, but none of that changes that no politician will speak about their support for some healthcare policy in those terms. It would be electoral suicide if they're from a competitive district.
I want a wealth redistribution program as redress for past injustices. Current concentrations of wealth and property are the result of force and fraud, and I do not see how anyone should support preserving those distributions, let alone enshrining their preservation as a moral imperative.
> So, if your good coverage went from $175/month to $450/month and covered less and less with each passing year
But that's not the case, because that $175/month insurance didn't meet current standards of "good." While the ACA made it happen a lot faster for health insurance, this is kind of like me bitching about how high my car payments are because they keep adding on stupid useless things like bumpers, seatbelts, airbags and antilock brakes and I don't need ANY of those because "I don't get into accidents and if I do I have enough savings to cover it."
As for the question of him not being able to get subsidies for himself as a matter of law, I'm 99% positive that the way you become ineligible for subsidies is by making too much money to qualify. It has nothing to do with owning your own business, and if he's telling you it does then he's blowing smoke up somewhere.
As for the amount you're paying before you get benefits, yeah, there are plans in there like that, and they tend to be cheaper. You might almost consider them catastrophic care plans, except they cost more than $175/month and cover things beyond hospitalization. They're the ones with "20% coinsurance after deductible" for regular doctor's office visits, while what you're probably looking for are the ones with a "$40/75 copay" for primary care/specialist visits. That coinsurance/copay bit is one of the things insurance companies can still do to game the system.
The thing that those plans all have in common though is a maximum out of pocket number. That means if your friend the lawyer has a heart attack, is hospitalized, needs a couple of stents put in immediately or god forbid a bypass and doesn't have the time to shop around for other hospitals that might be cheaper, he's not going to be leaving the hospital with $250,000+ in medical bills that he's personally responsible for. Sure, $10-15k is a lot of money to take on as unexpected debt, but for an awful lot of people that's not bankruptcy money it's "payment plans for a few years that are going to kind of suck" money.
I'd offer you the opportunity to do your own research into the subject if you'd like to investigate the implementation of ACA in NY state:
https://nystateofhealth.ny.gov/ https://nystateofhealth.ny.gov/
Let's start with how much money you need to make to see your subsidies completely extinguished: $50,000. That's the limit no matter if you live in Buffalo or Westchester.
Let's then get into the regulations associated with ownership of a company. Did you know that as the owner of a company no matter the size or organization, you're NOT considered an employee of your own company? Nor is your wife?
From the NY state website:
"Under 29 CFR 2510.3-3, an employee would not include a sole proprietor or the sole proprietor's spouse. The definition for Common Law employee can be found here.
The structure of the business does not matter. For example, the business could be a corporation, LLC or d/b/a.
Employees
(1) An individual and his or her spouse shall not be deemed to be employees with respect to a trade or business, whether incorporated or unincorporated, which is wholly owned by the individual or by the individual and his or her spouse, and
(2) A partner in a partnership and his or her spouse shall not be deemed to be employees with respect to the partnership.
Specifically, 29 CFR 2510.3�3 states the following:
(c) Employees. For purposes of this section:
(1) An individual and his or her spouse shall not be deemed to be employees with respect to a trade or business, whether incorporated or unincorporated, which is wholly owned by the individual or by the individual and his or her spouse, and
(2) A partner in a partnership and his or her spouse shall not be deemed to be employees with respect to the partnership."
So it does matter that the self-employed seem to get screwed a bit harder than the popular opinion acknowledges.
So, tell me again, which part of shifting costs from people who didn't go to law school and dropped out to work at McDonalds to those who finished school and did sounds like a fair deal to you?
Does shifting costs to those more conscientious sound like a great plan for national unity? How do you feel when your co-workers play hookey, sleep in, and write bad code? Do you think those folks deserve the same promotion opportunities you do? Do you think that any society that punishes achievers is one that is set up for success?
Let's discuss facts and not opinions. Show me the costs for insurance and where the subsidies end and tell me if you think it sounds like a good deal to you in a county where the property taxes for a small condo run about $25K per year.
> [link to NY Exchange, 50k cap for subsidies]
Great, so he's making more than $50k/year, I'd hope that to be the case if he was able to make it through college and get a J.D.
> [ownership of a company & employee status]
I'm not disputing that, though I suppose if he really wanted to he could form a C Corporation and give or sell a small percentage of the shares to someone else to make it possible for him to become an employee. He's an attorney, he'd have a far better idea of the legal issues surrounding that kind of thing than I would. It seems logical to me (though possibly not in NY law) that if by law he's not an employee that it then follows that he is also not an employer since there are no employees.
I don't see how any of the above is actually relevant. All it really means to me is that he'd be purchasing coverage in the "Individuals & Families" portion of the exchange. I've never lived in NY, but in my experience with the Illinois/Federal exchange I don't think I've never been asked whether I was an employer, only whether I was an employee of a company that provided health insurance (or was required to provide health insurance by virtue of being >50 people).
And quite frankly if he's paying more than twice my annual mortgage amount just in property taxes, my sympathy over his premium increasing from $175 to $450 is very limited.
Admittedly, I'd be perfectly happy to see a return to Kennedy-era tax rates for incomes over $4 million/year and I'd be ecstatic to have those rates apply to me (because it'd mean I was making at least that much in annual income, but my needs and wants are simple and easily met with less than $100,000/month of income), so maybe I'm not the kind of person likely to be incredibly sympathetic here.
Guess what, you can't just "form a C corp" and go from there. The rules specifically exclude that kind of structure.
Look, it all looks great but when you REALLY DIG down into the rules, what you see is a recipe for disaster. The plans in NY that had to shut down were staffed by a roster of amateurs because the laws SPECIFICALLY EXCLUDED people who had worked in the healthcare insurance industry from splitting off and starting their own companies.
They quite literally expected a bunch of community activists to run an insurance company and it failed MISERABLY.
Facts are sometimes inconvenient things.
I'm coming at it from the other angle. Republicans know they're stuck with an intractable problem. You can't cover people with large costs without raising the costs for everyone. The problem for Repubs at this point is that those with large costs have already been granted access. It's much easier for them to deny those with pre-existing conditions access than it is for them to now take that away. Futhermore, Repubs can repeal ACA without Dems help but can't pass a new bill without Dems. I believe the goal at this point is to repeal ACA without Dems then push a hyper-partisan ACA replacement which the Dems will not vote for. Then Repubs can successfully lay the blame at Democrats feet for not coming to the table and passing the replacement.
I work for a company which operates in the Medicare Advantage space.
A provision of the ACA sets a minimum medical loss ratio for us. In simpler terms: it puts a legal cap on our profit margin, by requiring a minimum percentage of the money we take in to be spent on benefits to our members (such as paying their claims).
That is almost certainly going to get repealed.
Unless medical care is cheap enough for everyone to always afford all the care they might require with the cash in their pockets or the money in their checking accounts, I believe my fundamental question is relevant. Since some medical care currently, and for the forseeable future, requires the time of extremely smart, talented, and highly-trained individuals, I don't believe it's possible to make it that cheap.
I agree with everything else you said though. Costs are too high and are a major reason this is so hard to solve and price transparency is a big part of the problem. A related (because it distorts the market in a similar way) problem is that most people don't see the true cost of their insurance, because they get it as a benefit from their employer. I would be highly in favor of any credible attempts to fix these issues. But that's not what I've been hearing from the party that's about to be completely in power.
Personally, I thought the ACA was a very honest plan. The individual mandate is a very clear statement of: healthy people must get insurance so that we can offset the cost of requiring that sick people can get insurance. I never had any illusions that, as a healthy young person, this would do anything besides increase medical costs (including insurance premiums) for me, as a trade-off against the possibility that I may one day be one of the older and/or sick people that it would benefit. I hoped it would decrease costs because we would no longer need to subsidize the uninsured by making up for care providers' lost revenue, but I didn't think that would (especially in the short term) be anything besides shifting that subsidy from being included in the cost of care to being included in premiums and federal taxes.
I was pretty sure it was going to make things more expensive for me, and I don't think it was sold any differently than that. I was not in favor of it, largely because I didn't think it would survive politically long enough for me to switch from the "loses" to the "benefits" category. We're sort of seeing that now, except that I'm actually sort of optimistic that its 6-year (or so) survival has enshrined it or something like it.
I believe a repeal-without-replace plan will be completely disastrous for the incoming government and that whatever government is next will have popular support to backtrack, and that a repeal-and-replace plan will end up settling on something very similar, maybe even with some free-market-based improvements!
Regarding C corps, that's why I noted diversifying the ownership of the company and "he's a lawyer, he'd know better than I."
Exchange-created co-ops bit the dust elsewhere as well. In Illinois it was Land of Lincoln Health, which was closed by the state because it was going to be unable to make a required payment into the program designed to help keep the newly-created companies stable. I believe whatever remains of LLH may actually still be suing the Federal government, because part of what drove them under was not getting ~$70m that they should have received through those same cost-sharing systems. (caveat: Not an insurance industry person and I didn't watch it that closely). Still, I'm sure that there were a lot of amateurs who got involved. I'm also sure there were a lot of professionals and investors who got involved and in many cases lost money because even minor fixes became impossible after the law was passed. NOTHING that was going to make the ACA's implementation better was going to make it through Congress, particularly the Senate.
The problem is that when you dig down into the rules you may find a recipe for disaster, but you also found the only way it could possibly work. There are minor nuances, but when you really dig down you find that the "liberal dream of Obamacare" is really "Romneycare" is really at its core a design created by the Heritage Foundation[1]. That's not to say that it's great or terrible or doomed because it was championed by Democrats or doomed because it was written by Republicans, it's just the only viable structure that doesn't have single-payer as its core. If the Republicans in Congress actually do come up with a replacement it's going to look almost identical to the ACA except for cosmetic differences and name changes, and if Democrats stick with "You broke it, YOU fix it" then it'll also never pass and we'll be right back where we were in 2008.
[1] http://americablog.com/2013/10/original-1989-document-heritage-foundation-created-obamacares-individual-mandate.html http://americablog.com/2013/10/original-1989-document-herita...
And a countervailing argument that "[The ACA is from the Heritage Foundation is bunk]" http://www.forbes.com/sites/johngoodman/2016/02/15/where-did-the-idea-of-obamacare-come-from-a-defense-of-the-heritage-foundation/#6637cb6b442b http://www.forbes.com/sites/johngoodman/2016/02/15/where-did...